1960 (3) TMI 36 - HC - VAT and Sales Tax

Summary

Issues:
Interpretation of the term "goods or silver bullion" in section 6 of the Hyderabad General Sales Tax Act, 1950.

Analysis:
The judgment by the Andhra Pradesh High Court, delivered by Chandra Reddy, C.J., and Sanjeeva Rao Naidu, JJ., addressed the common issue raised in three revision cases concerning the meaning of "goods or silver bullion" under the Hyderabad General Sales Tax Act, 1950. The petitioners, a firm dealing in gold, silver, and jewelry, contended that their turnover of selling sovereign gold, a mixture of pure gold and base metals like copper, should not be taxed as they had already paid tax. However, the Department disagreed, asserting that the metal sold did not qualify as gold bullion under section 6(1) and was thus taxable.

The petitioners' appeals to the Deputy Commissioner of Commercial Taxes and the Sales Tax Appellate Tribunal were unsuccessful, leading to the filing of revision cases. The petitioners argued that the term "gold or silver bullion" should encompass gold or silver mixed with base metals like copper or lead. The court, however, rejected this interpretation, emphasizing the legislative intent behind the use of the term "bullion." The court applied the rule of statutory construction that each word in a statute serves a specific purpose and is not redundant. The court referred to dictionary definitions of "bullion," highlighting its meaning as precious metal in the mass, uncoined gold or silver, or solid gold or silver.

Furthermore, the court examined definitions from Wharton's Law Lexicon and the Currency and Bank Notes Act, 1928, to elucidate the concept of bullion. The court noted that the Madras General Sales Tax Act and the Andhra Pradesh General Sales Tax Act also distinguished between "bullion" and other forms of gold or silver, indicating that "bullion" referred only to pure gold or silver. Consequently, the court concluded that "gold or silver bullion" under the Hyderabad General Sales Tax Act, 1950, pertains solely to pure gold or silver and does not include metals mixed with copper or lead. The court upheld the Tribunal's order and dismissed the revisions with costs.

In summary, the judgment clarified the scope of the term "goods or silver bullion" in the context of the Hyderabad General Sales Tax Act, emphasizing that it encompasses only pure gold or silver and not metals mixed with base metals like copper or lead.